You can create a bootable Win 7 / 8 / 8.1 USB thumb drive from any of these operating systems. For example, you can create a bootable Win 8.1 thumb drive from Win 7. I do this constantly.
If you want to do this manually, use this procedure:
Run diskpart.
From within diskpart, run these commands:
list disk (note which disk the thumb drive is. In this example, I'll assume disk 2).
select disk 2
clean
create partition primary
active
format fs=fat32 quick (Note: It's important to use FAT32. Some systems, especially UEFI based, will not boot from an NTFS thumb drive)
assign
exit
At this point copy ALL files from your Windows ISO to the thumb drive. The drive should be bootable.
Tip: If you are running Windows 8 / 8.1, you can open the ISO directly from within Windows and copy the contents to the thumb drive. On Windows 7, use some utility to extract the contents from the ISO and copy them to the thumb drive. I find that current versions of WinZIP work well.